1

H Y Y G r o u p

A n n u a l R e p o r t

1 9 9 7

2

Cover picture:

Eero Järnefelt 1863 - 1937, Flora Festival 1848.

Owned by Signe och Ane Jyllenberg st iftelse

Foundation.

The Finnish national anthem Our Land was

sung in public for the first time at the Flora day

celebration of Finnish students on May 1848.

The black-and-white photos convey the

atmosphere at the 100th anniversary of the first

singing of the Finnish national anthem,

Our Land, in 1948.

Introduction to the HYY Group’s operations ..................... 3

Review by the President and CEO ......................................... 4

Organization chart .................................................................. 6

Information on the personnel ............................................... 7

Key indicators 1993 - 1997 ..................................................... 8

Real Estate Division ............................................................... 10

Travel Group ........................................................................... 12

Catering Division ................................................................... 14

Book Division ......................................................................... 16

The Group’s parent company, HYY Group Ltd ................. 18

The ecological quality of operations .................................. 19

The ground rules of the Group’s owner ............................. 20

The owner of the Group ....................................................... 21

IAS FINANCIAL STATEMENTS 1997

Annual report of the Board of Directors

for 1997 ...................................................................... 22

Income statement ..................................................... 25

Balance sheet ............................................................. 25

Cash flow statement ................................................. 26

Comparison of Finnish and

IAS Financial Statements ......................................... 27

Accounting conventions .......................................... 27

Notes to the income statement and

balance sheet (IAS) ................................................... 29

Signatures ................................................................... 31

Report of the Auditors ............................................. 31

Administration and Boards of Directors ........................... 32

Executive management ......................................................... 33

Auditors ................................................................................... 33

Business locations .................................................................. 34

T a b l e o f C o n t e n t s

The pictures on the back cover show the

leading figures in the birth of the anthem:

Fredrik Pacius, J.L. Runeberg, Fredrik

Cygnaeus and Zachris Topelius.

3

A company handling the

management, leasing out and

maintenance of the Student

Union’s buildings. The compa-

ny owns individual commer-

cial and residential suites.

The HYY Group consists of the real estate owned

by the Student Union of the University of Helsinki

plus the HYY Group Ltd. In terms of corporate

operations, the Group is a multibusiness, interna-

tional corporate group in the service sector.

Field of business

Bookstore and stationery

chain for the university com-

munity.

Restaurant Vanha and

Hostel Academica, Helsinki

Business locations in

Finland (4), Sweden (7),

Norway (7), Denmark (6),

the Netherlands (1),

Germany (5) and Spain (1).

REAL ESTATE

DIVISION

The Student

Union’s real estate

TRAVEL

DIVISION

CATERING

DIVISION

BOOK

DIVISION

Commercial premises opera-

tions plus maintenance of busi-

ness premises in support of

the Student Union’s mission.

The city centre property in

the heart of Helsinki and the

Leppäsuo property in the

Kamppi district of Helsinki

LocationsOperations Share of Group

net sales

Kaivopiha Ltd Business location: Helsinki.

Commercial and residential

suites in Helsinki, Turku,

Tampere, Jyväskylä and Oulu.

The KILROY

travels subgroup

A major European student

and youth travel agency.

Oy UniCafe Ab A restaurant chain providing

lunches and café products,

mainly for the students and

staff of Helsinki University.

19 restaurants in Helsinki,

mostly on university premises.

Oy Gaudeamus Ab A company producing restau-

rant, café and accommodation

services and entertainments.

University Press

Finland Ltd

Publisher of literature on the

humanities, social sciences

and technology.

Publishing houses Gaudeamus

Kirja and Otatieto, Helsinki.

University Book-

store Finland Ltd

4 bookstore/stationery outlets in

the Helsinki Metropolitan Area.

6%

84%

7%

3%

I n t r o d u c t i o n t ot h e H Y Y G r o u p ’ sO p e r a t i o n s

Unit

4

R e v i e w b yt h e P r e s i d e n ta n d C E O

Profit target exceededThe operative profit target set for 1997 by

the Group’s owner, before taxes and ac-

counting adjustments, including Group-

level depreciation of goodwill, was approx-

imately FIM 27␣ million. The actual, com-

parable profit for 1997 was approximately

FIM 32␣ million. The profit was a distinct

improvement on the previous year’s figure.

A healthy trend in profits in both the

principal divisions - Real Estate and Travel

- was based to a marked extent on the stra-

tegic lines adopted and investments made

in the early and middle years of this dec-

ade, which are now beginning to bear fruit.

In no division was there a significant

downturn in profits, although there were

some minor setbacks prior to a revision of

the operating policy.

Financial value added

The Group has calculated the financial val-

ue added - a somewhat fashionable con-

cept - to its owners in its reporting to the

owner’s administration for the past few

years. When the accounting conventions

are established and comparability is im-

proved, this information can also be in-

cluded in the annual report.

For the Group’s most important divi-

sion from the viewpoint of restricted equi-

ty, the Real Estate Division, the Group is

now publishing for the third time the main

changes in real estate capital values in an

audited note to the financial statements. In

1997, the capital return of real estate,

based on Finnish and international con-

ventions, i.e., the positive change in value

during the year, was some FIM 59␣ million.

The total return from real estate in 1997,

comprising the income return from rental

business and capital return calculated at

capital values as at the beginning of 1997,

was 12.7%.

Investments in real estateA renovation of the office facilities in the

city centre property was largely completed

during the year under review. A systematic

programme of improvement in the com-

mercial prospects of the building was

launched during the year. Investments in

the pedestrian underpass across Mannerhei-

mintie, the main thoroughfare in central

Helsinki will be completed during the cur-

rent year along with a change in the busi-

ness concept of Hansa House. The planning

for other enhancements to the city centre

property is proceeding in smooth coopera-

tion with the city and with the neighbours.

The Group’s own investments in a major

renovation have also begun in the Leppäsuo

Property. More thoroughgoing commercial

development is still dependent on the situa-

tion for planning permission in this district

of Helsinki.

A challenging phase forthe Travel Group

In the Travel Group, the customers and

needs are continuing to grow globally, in

KILROY travels’ market segment faster than

the average for this industry. There will be

significant changes in the technical struc-

tures of transacting business in the foresee-

able future. The brand and added values

will be of greater importance. KILROY has a

challenging stage ahead of it in terms of

management. The head start over leading

competitors gained in recent years, particu-

larly through investment in information

technology, will have to be exploited to its

fullest extent in the years ahead. At the same

time it is necessary to prepare, carefully but

briskly, to move into a completely new

stage. The HYY Group’s parent organization

has sufficient financial risk-taking capacity

to handle KILROY’s future development re-

quirements even without bringing in new

shareholders. The company’s life cycle and

its new stage of evolution may, however, jus-

tify a wider ownership and the dynamic use

of the capital market.

Culture and competition inuniversity communities

The Book Division’s publishing had a year

of rising fame and prestige, and it was even

praised for its cultural achievements. In fi-

nancial terms, the profits are modest. How-

ever, its tireless persistence in the apprecia-

tion of quality and scientific substance has

won enough of a response from paying cus-

tomers to establish economic grounds for

continuing in business.

The HYY Group embarked on book-

store business in the 1980s, making a splash

in the marketplace. Competition, especially

with imported scientific literature, failed to

take root. The pricing and services were in

accordance with this. The situation today

has been totally transformed. In the tradi-

tional books business, competition over

prices and service is a good thing for the

customer. The recent shakeout will further

stimulate this in the Helsinki Metropolitan

Area and in university business. Electronic

shopping is also excellently suited to selling

books.

The University Bookstore has done its

O u r l a n d , o u r l a n d , o u r n a t i v e l a n d . . .

5

housework and drawn its conclusions. The

company will continue to concentrate - in-

stead of on growth and bulk - on its genu-

ine, permanent competitive advantages: its

everyday presence in the lives of students

and the rest of the university community.

The UniCafe company, together with

its restaurants, competes within an open

arena of competition with all the other

major catering chains, and it gets no better

financial benefits from its principals than

its rivals. A competitive advantage in rela-

tion to its owner is that the parent compa-

ny has refunded UniCafe’s positive profit

to it, with interest added, for almost a dec-

ade. In combination with the company’s

efficient operations, this has facilitated a

lasting price advantage in competition.

Since, to put it modestly, the quality of the

products and services is at least as good as

the competitors’, only a shortage of suita-

ble business premises has got in the way of

faster growth.

Lightweight centraladministration

It is important from the viewpoint of the

Group’s financial performance that the so-

called central administration is kept as

light as possible. The Group has few cen-

tralized functions other than those im-

posed by law. Even these usually take the

form of a project or are dispersed in a net-

work among the business units. Long-term

benefits have been seen in centralizing in-

ternal banking services and their external

money trading, as well as in registered reg-

ular customer systems.

An old owner witha fresh outlook

The HYY Group’s owner, the Student Un-

ion of the University of Helsinki, is 130

years old this year. Over the first 100 years,

commercial operations consisted almost

exclusively of real estate business. High-

risk investments by different, bold genera-

tions using borrowed money. Financially

marginal contributions to buildings used

for social and cultural purposes have had

an inspiring and encouraging impact in

their time. However, the property obtained

through the contributions has made a loss

and continues to do so. The ownership of

the donations and maintaining the activi-

ties related to them demand cash flow fi-

nancing and successful business.

In the course of the past 30 years, the

economic activities of the Student Union

of the University of Helsinki have expand-

ed into a multibusiness, international cor-

porate operation. Showing the spirit of en-

terprise and taking reasonable risks. In ex-

ternal assessments commissioned by the

Student Union as the owner, the success

established by the HYY Group has been

portrayed as moderate on average, even

good or exellent at times and in certain

sectors. The most recent assessment is the

BAS rating, signed by three prestigious

professors, which is referred to elsewhere

in this annual report.

Especially in internationally profitable

and desirable business, there is a chance of

owner-related risks in addition to the ordi-

nary risks of business life. It has been en-

couraging in the past few years to note

that, in spite of the rotation in the owner’s

administration that is a natural part of an

organization of its kind, the Student Union

as an owner has been able to act in a unified

way, decisively and professionally to repel

outside attempts to deflect the owner’s deci-

sion-making process. In other respects too,

the owner’s decision-making has been in-

vigorated since the system was reformed.

Prospects for the 1998

financial yearKILROY travels’ net sales are forecast to ex-

perience further growth ahead of the overall

market’s growth rate, and the net profit is

also expected to improve.

Because of the high occupancy rate of

the buildings, rental net sales will not grow

substantially with the present portfolio of

buildings. As a result of new and extended

lease agreements, the net profit would im-

prove and reach the peak levels of the late

1980s already in 1998 but for the drag on

profits exerted by extensive renovations and

alterations which will temporarily reduce

rental income.

The combined financial result of the

Catering and Book Divisions is forecast to

be slightly in the black once again. Restruc-

turing is being carried out in the Book Divi-

sion, and this may reduce net sales but it is

aimed at improving profitability.

The entire HYY Group’s budgeted net

sales for 1998 are roughly FIM 1.1␣ billion.

The net profit is forecast to be on a par with

the 1997 figure.

I thank our customers, personnel and

owners for a good year in 1997.

Tapio Kiiskinen

6

T h e H Y Y G r o u p

he HYY Group’s net sales in

1997 were FIM 910.6 million.

Net sales were up by 14%. Of the

Group’s net sales, 29% was generated in

Finland and 71% originated in the other

Nordic countries, Germany, the Nether-

lands, Spain and other parts of Europe.

The Group’s return on investment

was 18.2%. The profit before extraordi-

nary items, appropriations and taxes

amounted to FIM 28.1 million. The

book profit was FIM 17.4 million.

The HYY Group will distribute FIM

13.0 million out of the 1997 net profit

to the Student Union of Helsinki Uni-

versity. The HYY Group covered FIM

1.5 million of the deficit arising from

the social, cultural and operational

premises of the Student Union, exerting

a drag on its overall result. In addition,

UniCafe distributed FIM 2.4 million to

the members of the Student Union dur-

ing the year in the form of supplementa-

ry price support for student meals.

HYY Group

*Board Advisor ServiceB.A.S. Oy:corporate rating for the HYY Group,

29 October 1997.

Rating team:

Professor Arto Lahti

Professor Olli Martikainen

Professor Vesa Puttonen

T

Catering Division

Oy UniCafe AbUniversity restaurants

Oy Gaudeamus AbOld Student HouseHostel Academica

Book Division

Real Estate Division

Travel Group

Real EstateFunds of HYY

(Parent corporationof the Group)

University PressFinland Ltd

KILROY travelsInternational A/S

Subsidiares in Nordiccountries, Netherlands,

Germany and Spain

HYY Ejendomme A/S

HYY Group Ltd Kaivopiha Ltd

University Bookstore Finland Ltd

HYY Real Estate

*BAS rating“The HYY Group, as a corporation aggre-

gate, is exceptionally sound financially

and its risk status is good.”

7

400

300

200

100

0

Number

There were 110 part-timers/hourly paid staff, of whom KILROY travelsemployed 76. It is part of KILROY travels’ business principles to employstudents as part-time employees.

TravelGroup

Real EstateDivision

CateringDivision

BookDivision

2032

208

391

14

Distribution of personnel ages by division, 31 December 1997(Including part-timers/hourly paid staff)

Parentcompany

under 20 yrs

20-29 yrs

30-39 yrs

40-49 yrs

over 50 yrs

Henkilöstön ikäjakauma toimialoittain 31.12.1997. Koko yhtymä.(mukana myös osa-aikaiset/tuntityöntekijät)

alle 20 v.

20 -29 v.

30 -39 v.

40 - 49 v.

yli 50 v.

I n f o r m a t i o no n t h e P e r s o n n e l

Average personnel in Finland/abroad 1993 - 1997

600

400

200

01993 1994 1995 1996 1997

*)

519

436501

579551 Travel Group

Real Estate Division

Catering Division

Book Division

Parent company +others

*) In 1993 the BookDivision was part of theCatering Division.

Personnel below the

line were in Finland

Average age of personnel, 31 December 1997(Including part-timers/hourly paid staff)

40

30

20

10

0

Age

29

43

34 36

41

31Travel Group

Real Estate Division

Catering Division

Book Division

Parent company

Total for wholeGroup

Information on the management of

the HYY Group

The average age of the HYY Group’s management was 43.

Of the directors, 8 were women and 8 were men.

The average length of service of the directors in the Group

was 12.3 years.

Trend in personnel expenses relative to trend in net sales,1993 - 1997

1993 1994 1995 1996 1997

FIM million

1100

1000

900

800

700

600

500

400

300

200

100

0

Net sales

Personnel

expenses

Women

Men

Distribution by gender, 31 December 1997(Including part-timers/hourly paid staff)

Men: 25%

Women: 75%

under 20 yrs

20-29 yrs

30-39 yrs

40-49 yrs

over 50 yrs

Distribution of personnel ages, 31 December 1997, whole Group(Including part-timers/hourly paid staff )

8

K e y I n d i c a t o r s1 9 9 3 – 1 9 9 7

Overall result Profit before extraordinary items, appropriations andtaxes – taxes +/– exchange rate losses

Return on investment (ROI), % Net profit + financing expenses + taxes x 100

Balance sheet total – non-interest-bearing liabilities(average)

Return on equity (ROE), % Net profit + financing expenses + taxes x 100

if revaluation of land areas Balance sheet total + revaluation contingency – is realized 1) Non-interest-bearing liabilities (average)

Equity ratio at book values, % Shareholders’ equity + minority interest + reserves x 100

Balance sheet total – advances received

Equity ratio, if revaluation Shareholders’ equity + minority interest + reservesof land areas included, %2) + revaluation contingency x 100

Balance sheet total – advances received + revaluation contingency

Security ratio Security value of the securable assets

Interest-bearing liabilities with interest (or pledges,mortgages and other guarantees, if greater)

Tied-up risk by division Owner’s total risk = equity and quasi-equity investments+ loans granted + collateral provided as pledges andguarantees given

Formulas for key indicators

The key indicators are calculated in accordancewith the conventions renewed in 1995 by theFinnish Committee for Corporate Analysis.The capital value and the annual capital returnof the main items of real estate have been calcu-lated in accordance with the conventions of theFinnish Institute for Real Estate Economics.

1) Income return without forthcoming capitalreturn at the beginning of the year, if revalua-tion had been realized at the end of the previ-ous year. Does not indicate the realized overallresult or return on investment.

2) In the officially audited financial statements,the requirements for revaluation contingencyunder the Finnish Accounting Act (materiality,consistency, tradability), are added to the share-holders’ equity in the capital structure review.

1993 1994 1995 1996 1997

Turnover FIM m 1030.1 660.0 710.8 798.4 910.6Change % -3.4 -35.9 7.7 12.3 14.1Personnel expenses FIM m 92.4 73.3 85.8 93.5 104.1Personnel expenses:net sales % 9.0 11.1 12.1 11.7 11.4Operating profit before depreciation FIM m 52.9 54.4 38.5 45.3 48.5Net earnings from operations 1) FIM m 23.2 30.7 17.0 22.2 28.1Gross investments FIM m 8.5 12.1 26.0 24.9 15.7Gross investments: net sales % 0.8 1.8 3.7 3.1 1.7Balance sheet total FIM m 353.9 312.2 331.3 337.9 363.3Shareholders’ equity FIM m 18.5 28.7 26.2 28.5 45.9

Dividend payment to minorityshareholders FIM m 0.5 0.5 1.1 0.3 0.2Distribution of profit to Student Union FIM m 12.3 11.7 11.7 12.8 13.0Direct distribution of profit. total FIM m 12.8 12.2 12.9 13.1 13.2Support for Student Union membershipand activities at expense of Group profit FIM m 6.9 6.3 5.7 4.0 3.9

Return on investment % 21.3 25.7 17.2 17.1 18.2Equity ratio at book values % 6.5 14.4 11.2 11.6 18.2Equity ration including potential %revaluation of land areas % 44.1 54.3 48.9 47.7 51.7Return on equity if the revaluationis realized % 10.5 12.7 8.3 8.0 8.6

1)Profit before extraordinary items, reserves and taxes

9

Dividends

Support for Union members andoperations exerting a drag on theGroup's profit

201993 1994 1995 1996 1997

15

10

0

10

15

20

FIM million

12.311.6

6.3 3.9

12.0

5.76.9

12.8

4.0

13.0

From HYY Group to the Union'scontingency reserve

Profitbefore taxes, appropriations and

extraordinary items

0

1993 1994 1995 1996 1997

10

20

30

40

50

60

FIM million

23.2

30.7

22.2

28.1

17.0

160

140

120

100

80

60

40

20

0

11,9

147,8

Sidotut vastuuriskittoimialoittain

1997

Kiinteistö-ala

Palvelu- jakirja-ala

Matkailu-ala

milj.mk

27,2

140

120

100

80

60

40

20

0

19.2

Invested capitalby division,

1997

Real EstateDivision

Cateringand BookDivision

TravelGroup

50.2

FIM million136.7 35

30

25

20

15

10

5

0

19.8

Return on investment,by division, %

Real EstateDivision

Cateringand BookDivision

TravelGroup

%

16.514.4

18.8

9.4 9.7

1996 1997

5.5

1993 1994 1995 1996 1997

Security ratio

10

8

6

4

2

0

4.0 4.24.6

4.9

60

50

40

30

20

10

0

%

21.3

1993 1994 1995 1996 1997

10.512.7

25.7

8.3 8.0

18.2

Return on investment, %

Return on equity, %, if the

revaluation of land areas is

realized

8.6

17.2 17.1

90

75

60

45

30

15

0

%

44.1

1993 1994 1995 1996 1997

54.3

11.2

48.9 47.7

11.6

51.7

14.46.5

18.2

Equity ratio at book values, %

Equity ratio, allowing forrevaluation contingencyof land areas, %

Overall result

01993 1994 1995 1996 1997

10

20

30

40

50

60

27.6

13.2

FIM million

13.3 14.718.8

1993 1994 1995 1996 1997

Net sales

Travel Group

Real Estate Division

Catering and Book Division

Information Technology

Parent company

1100

1000

900

800

700

600

500

400

300

200

100

0

FIM million

1031.1

660.0710.8

798.4

910.6

500

1994 1995 1996

520

540

560

580

600

milj.mk

579,1+33,0

612,7

+33,6

1997

663,3

+50,9

546,1

620

660

640

FIM million

Real EstateDivision

TravelGroup

Cateringand BookDivision

Tied-up risksby division,

1997

FIM million

Capital valueAnnual positive capital return

Capital value of Student Union’s City Centre Property

and its annual change incapital return

663.3

+50.9

612.7

579.1

546.1

+33.6

+33.0

Gross investment

0

1993 1994 1995 1996

10

20

30

40

50

60

FIM million

8.412.1

26.0

1997

24.9

15.7

147.8

27.2

11.9

10

he Real Estate Division’s busi-

ness is long-term investment in

and development and mainte-

nance of real estate and cooperative

housing shares.

The Real Estate Division’s service

operations provide the various units of

the Students’ Union and related organi-

zations with premises in which to oper-

ate, as well as providing housing at af-

fordable rents, mainly for members of

the Student Union.

The City Centre Property stands in

the heart of Helsinki and comprises the

Kaivopiha Commercial Building and the

premises used by the Student Union it-

self. In the Leppäsuo quarter of the

Kamppi district is the Leppäsuo Proper-

ty, which comprises Domus Academica

and a library building.

The Kaivopiha Commercial Build-

ing provides services, experiences and

specialist shops for leisure, entertain-

ment and culture as well as office facili-

ties. The commercial and office space

available for lease amounts to some

25,500 square metres. There are some 70

tenants in the building.

A partnership concept has been ap-

plied successfully in the field of leasing

business and investment in the past few

years. Planning and carrying out invest-

ments jointly with major corporate cus-

tomers has yielded good results. We have

great expectations for the benefits of the

concept. Partnership investments with

tenants in commercial and office space

are currently in progress.

Among the foremost tenant-part-

T

Yrjö Herva, Director in charge of the Real Estate D ivision (right)

with Assistant Director Jukka Leinonen

Net sales

Average number of employees

R e a l E s t a t eD i v i s i o n

ners with premises in the commercial

building are the Rautakirja Group’s

Suomalainen Kirjakauppa and Tiimari,

three restaurants of the HOK Group’s

Helsinki Ravintolat Oy, the University

Pharmacy, and the HYY Group’s own

KILROY travels agency.

Among the main users of the office

facilities are Finland Travel Bureau Ltd

and Patria Industries, both Finnish com-

panies, and international companies such

as Akzo Nobel, Unibank and Berlitz In-

ternational.

The City Centre Property also hous-

es the substantial business premises oc-

cupied by the HYY Group’s owner, the

Student Union of the University of Hel-

sinki and related organizations and cor-

porations, comprising a total of approxi-

mately 4,800 square metres.

The Leppäsuo Property contains stu-

dent housing as well as various facilities

including a library and classrooms. Op-

erations in the area take place in close

partnership with the University of Hel-

sinki, the Helsinki School of Economics

and Business Administration, the Foun-

dation for Student Housing in the Hel-

sinki Region, and the UniCafe and Gaud-

eamus units of the HYY Group’s Cater-

ing Division. The Student Union also has

student housing facilities in the Haaga

district of Helsinki.

The Real Estate Division also includes

Kaivopiha Ltd’s office and residential

building in the Lauttasaari district of Hel-

sinki as well as miscellaneous commercial

suites and residential apartments in Turku,

Tampere, Jyväskylä and Oulu.

1995 1996 19970

50

100

150

200

300

15 15 14

1995 1996 19970

200

400

600

800

1000FIM million

55.2 55.656.4

1995 1996 1997-5

0

10

15

20FIM million

5

19.6

13.213.8

Profit before taxes,appropriations andextraordinary items

FIM million

O

h , l e t h e r n a m e r i n g c l e a r ! . . .

11

Leppäsuon kiinteistönhuoneistoala tilatyypeittäin

31.12.1997

Vuokra-alayhteensä 15.630 m2

Asuintilat: 48 %

Kirjasto: 16 %

Toimitilat: 35 %

The profit target for the Real Estate

Division’s operations is the optimum

long-term profit, among the best in its

field in Finland, based on sustainable

business values.

The Real Estate Division’s net sales

in 1997 totalled FIM 55.6 million and it

had an average of 14 employees.

HYY Group Real Estate owned byStudent Union

One of the biggest tenants in the Kaivopiha

Commercial Building is Helsinki Ravintolat,

whose Heartbreakers restaurant was opened in

spring 1997. In the late autumn of 1998, Hel-

sinki Ravintolat’s new 700-seater restaurant La

Tour will open in Kaivopiha.

Keskustakiinteistönhuoneistoala tilatyypeittäin

Toimistotilat:toimistot/opetus-/salitilat52 %

Liiketilat:myymälät/ravintolat

36 %

Muut: 6%

Varastot: 7%

Vuokra-alayhteensä 31.170 m2

*BAS rating“The Real Estate Division enjoys excellent

profitability in view of the yield relative

to real restricted equity. The income return

of leasing business, assessed in terms of

the buildings’ capital value on the basis of

productive value, would be merely satis-

factory as yield in any other business than

real estate. However, unrealized capital

return constitutes an essential part of the

overall return on real estate investment

assessed in terms of capital values. It is

also incontrovertible that the net worth of

leasing operations is substantial and it

has been expanded strategically with an

expert investment-customer policy.”

Net leasable area in City Centre Property bytype of facility, 31 December 1997

Net leasable area in Leppäsuo Property bytype of facility, 31 December 1997

Leased area31,170 sq.m. in total

Leased area15,630 sq.m. in total

48% Residential

16% Library36% Businesspremises

36%Commercial

premises:shops/

restaurants

6% Others

7% Storage

52% Officepremisesoffices/teachingfacilities/halls

12

T r a v e l G r o u p Børge Faaborg, Managing Director and CEO of the Travel Group

338

1995 1996 19970

50

100

150

200

300306

274

Net sales

Human Resources

The growth of KILROY travels depends

on securing and developing the neces-

sary human resources within the KIL-

ROY travels Group. Moreover, the hu-

man factor is crucial to the branding

process. The development of our people,

the staff, is the process of achieving out-

standing performance by enabling peo-

ple to achieve and give their best.

Products

KILROY travels offers an assortment of

travel products and related services. We

choose them on the basis of quality,

flexibility and customer demand. Con-

centration and development always take

place around our customers’ highest pri-

oritized products. They are priced to be

affordable in our market segment. Our

products evoke in the customer the ex-

pectation of freedom, adventure and

discovery.

Information Technology

IT is exploited for competitive advan-

tage. The use of information technology

is crucial to efficient service, better

knowledge of the customers’ needs, low

costs and constantly improved market

communications. All KILROY travels

Group marketing activities are planned

and executed with the aid of informa-

tion supplied by the Group’s IT resourc-

es.

Our foundation, the customers, drive

KILROY travels’ business decisions

across all functions of our Group.

T

N o p e a k s a g a i n s t t h e h e a v e n s t h a t s t a n d . . .

he branding of KILROY travels

takes the basic functions of our

travel and service products and

combines these with the customers’

emotional needs in a focused, credible

and integrated way. The basic function

of our main product - an airline ticket -

is simple: it is a pass that entitles the

holder to travel from one point to an-

other. The emotional needs of KILROY

travels’ customers - to discover the

world, to discover themselves, to en-

counter different cultures - are anything

but simple. Branding is everything that

KILROY travels adds to our products -

an emotional universe where we offer

our customers freedom to test their lim-

its. KILROY travels’ branding is a prom-

ise of value. What we sell is the delivery

of that promise. There is no difference

between what we sell and who we are.

KILROY travels’ branding is sup-

ported by four cornerstones: Segmenta-

tion, Human Resources, Products and

Information Technology.

Segmentation

Our customer group consists of students

and other young people aged 16 to 33.

Tight segmentation lets us concentrate

all our sales efforts, all our marketing

and all our market research. This allows

us to ensure continuing, efficient inter-

action with airlines and other suppliers

who appreciate that we serve only this

market segment. This in turn makes it

possible to offer our customers the most

attractive travel products.

Average number of employees

Profit before taxes, appropriationsand extraordinary items, afterGroup goodwill deprec iation

1995 1996 19970

200

400

600

800

1000FIM million

655.2

759.0

574.2

1995 1996 1997-5

0

10

15

20FIM million

7.5

5 3.2

9.4

13

During KILROY trav-

els’ Crazy Days cam-

paign in March 1998,

the cheapest summer

flights were sold and

free trips were raffled.

The campaign was a

co-production by the

Finnish, Swedish,

Norwegian and Dan-

ish KILROY bureaus

in collaboration with

Brit ish Airways.

Each cornerstone is individually

important. Together, they add up to the

promise we make to our customers eve-

ry day: that when they buy a trip

through KILROY travels, they buy more

than a ticket - they buy a chance to dis-

cover and test their own limits.

The Travel Group’s net sales in 1997

were FIM 759 million with an average of

338 staff.

*BAS rating“KILROY’s profitability has declined from

its peak in 1994 for reasons including the

costs of running in the new information

technology system and substantial invest-

ments in opening up new markets. Profita-

bility can be restored to excellent levels in

the next few years if the strategic develop-

ment action is successful as expected.”

14

1993 1994 1995 1996 19970

1000

1100

1200

1300

1400

1500

1600

1000 kpl

T

C a t e r i n gD i v i s i o n

Oy Gaudeamus Ab

Oy Gaudeamus Ab produces and sells

restaurant, café, entertainment, and ac-

commodation services.

Restaurant Vanha operates in the

Old Student House. It has a wide range

of activities. Everyday operations consist

of a brasserie and an international

newspaper café. Almost every day, the

Old Student House hosts a number of

celebrations, conferences and private

parties. On a more seasonal basis, events

such as concerts and club meetings are

held. In 1997 Restaurant Vanha played

host to 719 events in addition to its res-

taurant business.

Hostel Academica is a low-price and

popular summer hotel with 115 rooms.

It operates from June to September. The

hostel is in the Domus Academica build-

ing on Leppäsuonkatu.

The Catering Division’s profit target

is to make a reasonable return on the

owner’s investment and risk. In addition

to its financial targets, the Catering Di-

vision also has targets for quality and

values. The Catering Division is still one

of the core businesses in which owner-

administration expertise and initiative

are of key importance.

The Catering Division’s net sales in

1997 totalled FIM 66.2␣ million with an

average of 184 employees.

Marjo Berglund, Assistant Director in charge of the Catering Division (rig ht)

with Assistant Director of UniCafe, Liisa Lehtinen.

1995 1996 19970

50

100

150

200

300

165179 184

1995 1996 19970

200

400

600

800

1000FIM million

54.3 62.2 66.2

1995 1996 1997-5

0

10

15

20FIM million

1.6 2.15 3.6

Net sales

1,000

Number of student meals sold,1993-97

he companies of the Catering

Division serve students, educa-

tional communities and their

employees in the Helsinki Metropolitan

Area and especially at the University of

Helsinki. The companies may also oper-

ate separately in other market areas. In

these cases, the aim is to support the

mission financially and to maintain

market-based efficiency.

Oy UniCafe Ab

Oy UniCafe Ab’s 19 restaurants serve in-

expensive, tasty lunches as well as pro-

viding café and party catering services.

Every effort is made to produce services

in a way that minimizes environmental

impact. The UniCafe service brand

name is based on success factors and

values applied to everyday operations.

UniCafe’s customers are young, highly

educated adults. Most UniCafe restau-

rants are in premises at the University of

Helsinki.

No

g e n t l e d a l e s o r f o a m i n g s t r a n d . . .

Average number of employees

Profit before taxes,appropriations andextraordinary items

15

UniCafe restaurants sold more than 1.6 mil-

lion student meals priced between FIM 8.50

and 12.50 in 1997. Some 12,000 people eat at

UniCafe restaurants each day. The picture

shows the UniCafe Tiedepuisto in Viikki.

16

T

B o o k D i v i s i o n Aila Santanen, Managing Director in charge of the Book Div ision

versity and the scientific community, and to

have a positive impact on the corporate im-

age of the owners and the HYY Group.

Oy Yliopistokirjakauppa

University Bookstore Finland LtdUniversity Bookstore Finland Ltd engages

in bookstore and retail stationery business.

The bookstores in the city centre, Portha-

nia, Viikki and at the University of Art and

Design comprise the University Bookstore

chain. They offer their customers scientific

works and nonfiction as well as textbooks

and course materials. Additionally, the

bookstores sell accessories for studying, of-

fice equipment and computer consumables,

and artistic materials as well as other pe-

ripheral materials and services. The Univer-

sity Bookstore chain also acts as the retail

outlet for the Book Division’s own publish-

ers. The University of Helsinki is a leading

minority shareholder in University Book-

store Finland Ltd, with a 20% interest.

The general point of departure for book-

store business is to generate an adequate

profit for the owners.

The Book Division’s net sales in 1997

totalled FIM 28.7 million and it had an av-

erage of 26 employees.

1995 1996 19970

50

100

150

200

300

27 31 26

1995 1996 19970

200

400

600

800

1000FIM million

25.1 25.1 28.7

1995 1996 1997-5

0

10

15

20FIM million

-0.1-0.8

5

-0.3

Net sales

University BookstoresDistribution of net sales, 1997, FIM million

University Bookstore chainDistribution of sales (0%), 1997, FIM million

Deliveries6.5

Shop sales14.9Wholesale

4.0

Centre15.7

Porthania4.7

University ofTechnology

3.5

University of Art andDesign 0.7

Viikki 0.8

A r e l o v e d a s we

o u r h o m e r e v e r e . . .

he Book Division primarily serves

the needs of the University of Hel-

sinki and other members of the

Finnish science and education community,

by publishing, by wholesaling, delivering

and retailing Finnish and foreign nonfic-

tion and scientific literature, and by sales of

accessories and the mediation of teaching

handouts to supplement bookstore opera-

tions in a way that fits in with the station-

ery shop-type marketing channel.

Oy Yliopistokustannus

University Press Finland LtdUniversity Press Finland Ltd publishes liter-

ature in the fields of the humanities and so-

cial sciences as well as environment-related

matter and current affairs literature under

the name of Gaudeamus Kirja, as well as

publishing technical matter under the

name of Otatieto. Gaudeamus Kirja pub-

lished 32 new titles in 1997. Otatieto pub-

lished 12 new titles and 35 reprints during

the year. The company also produces teach-

ing handouts for the students of the Uni-

versity of Technology and other technologi-

cal education institutes in Finland.

The general points of departure in

publishing are to yield an adequate profit

to the owners, to be important to the uni-

Average number of employees

Profit before taxes,appropriations andextraordinary items

17

Aristotle is one of the founding fathers of Euro-

pean thought. With the third millennium ap-

proaching, his main works will soon have been

translated into Finnish.

*BAS rating“The profitability of the bookstore opera-

tions is poor and, in order to improve it, it

is necessary to carry out major structural

changes in addition to streamlining oper-

ations.”

18

H

First Vice-president Linnea MederT h e G r o u p ’ sP a r e n t C o m p a n y ,H Y Y G r o u p L t d

creation of service or business units,

with start-up backing where necessary

• The implementation of centralized

changes related to the all-Group oper-

ational level or the corporate culture

• The divestiture of service and busi-

ness units which do not fit in with the

Group strategy or its structure and

which have no prospects in the HYY

Group

• Investment to support and/or comple-

ment an enterprise managed by the

companies.

The UniCard Smart Card

HYY Group Ltd is introducing a smart

card designed for use in the university

community. A pilot run of the UniCard

was launched in spring 1998. The system

will be enlarged in autumn 1998 with

the aim of introducing the card into use

throughout the university community in

the Helsinki Metropolitan Area.

The UniCard combines a Student

Union card with a library card and debit

card. It also serves as a regular customer

card for transactions with the HYY

Group.

HYY Group Ltd’s net sales in 1997 to-

talled FIM 9.4 million with an average

of 17 employees.

1995 1996 19970

50

100

150

200

300

20 20 17

1995 1996 19970

200

400

600

800

1000FIM million

10.4 9.5 9.4

1995 1996 1997-5

0

10

15

20FIM million

1.6 2.0

-0.3

5

Net sales

T h e e a r t h o u r s i r e s h e l d d e a r . . .

YY Group Ltd owns and man-

ages the companies in its cor-

porate group in accordance

with the general principles and guide-

lines laid down by its owner, the Student

Union of the University of Helsinki. The

company also produces and sells inter-

nal services to the companies in the

Group and to the Student Union.

The parent company’s duties

and basic aims:

• The organizing of the operational and

corporate structure of the HYY Group

in a manner appropriate for the time

in question, and organizing its strate-

gic management

• Attending to the financing of the HYY

Group

• Producing internal services that are

cost-effective and competitive in

terms of performance for the HYY

Group

• Examining and development of new

businesses, using the Group’s risk-tak-

ing capacity or on behalf of the other

divisions, with a view to the possible

Average number of employees

Profit before taxes,appropriations andextraordinary items

19

T

Group Env ironmental Coordinator,

Financial Manager Ritva Kuuluvainen

T h e E c o l o g i c a lQ u a l i t y o fO p e r a t i o n s

he main points of the HYY

Group’s ecological management

in 1997 comprised the imple-

mentation of the environmental pro-

gramme approved in 1996, in accordance

with the general principles of business op-

erations. The aim is to reduce the indirect

environmental impacts typical of a service

industry company, arising from energy

and water consumption, waste disposal,

the materials used in producing services

and packaging, and transport.

Of statutory obligations, the general

regulations on waste disposal of the Waste

Management Act apply to the HYY Group.

An ecological event was held at the Stu-

dent Union’s city centre property at Kai-

vopiha in August, the aim of which was to

inform the tenants of the waste disposal

arrangements for the building. Advice was

given on sorting wastepaper into office

paper and other types for recycling. Part-

nering us in the event were the Helsinki

Metropolitan Area Council and Paperin-

keräys Oy, a paper recycling company.

One of the paramount aims of the

HYY Group is to reduce consumption of

energy and water and to use them more

efficiently. The HYY Group took part in

the energy conservation week arranged by

the Ministry of Trade and Industry’s In-

formation Centre for Energy Efficiency

Motiva in October. The conservation week

is something new in the corporate world.

The HYY Group was among the first 15

companies to take part, and it is partici-

pating along with eight other companies

in a study assessing the effect of the con-

servation week. During the week, the per-

sonnel and the business, organizational

and residential tenants of the Student Un-

ion’s buildings were provided with a wide

variety of information on more efficient

ways to use energy, particularly electricity.

An energy conservation day held by the

Ministry of Trade and Industry and Moti-

va was arranged at the Old Student

House.

The auditing prescribed by the ad-

ministration system for the environmental

programme was carried out in the sum-

mer for the first time. On the basis of au-

diting visits made to the business loca-

tions of the various divisions, combined

with the performance of the environmen-

tal management system, procurement sys-

tems and ecological accounting system, a

review was made of the current status of

environmental protection in the HYY

Group. It was noted in the summary that

very considerable progress has been made

in the environmental friendliness of prac-

tical work of all divisions. Further clarifi-

cation of questions of responsibility for

environmental affairs was recommended

for the constant improvement of environ-

mental friendliness, as were obtaining en-

vironmental reports from business part-

ners and increased training for the staff.

The Econet, which is in charge of or-

ganizing the HYY Group’s environmental

affairs, has integrated the hoped-for im-

provements from the auditing into its ac-

tion plan for 1998.

The HYY Group was one of the first compa-

nies to take part in the Energy Conservation

Week held by Motiva, the Information Centre

for Energy Efficiency, in October 1997. Moti-

va’s Energy Conservation Day was held at the

Old Student House in the spirit of a sit-in.

Ph

oto:

Ad

olfo

Ver

a, s

ourc

e M

otiv

a

. . . T h e f l o w e r s i n t h e i r b u d s t h a t g r o p e . . .

20

General guidelines and aims

for the ownership of business

operations

The general premise for the ownership

of business operations by the Student

Union of the University of Helsinki is fi-

nancial support for the performance of

the real duties of the Student Union

specified in the regulations of the Un-

ion. Another ground for ownership may

also be the improvement and mainte-

nance of essential services for the mem-

bers if it can be shown that this makes it

possible to attain benefits compared to

what is available on the open market.

The general aim of ownership is to

preserve and care for the property of the

Student Union so as to protect the op-

portunities available to future genera-

tions of members. The purpose of busi-

ness activities is, in all circumstances, to

be more profitable in the long term than

risk-free investment. The maximum

risk-taking capacity of business opera-

tions is defined conservatively so that

the ability of the Students’ Union of the

University of Helsinki to handle its basic

duties will not be jeopardized in any cir-

cumstances.

General principles of

business operations

The HYY Group engages in business

with a long-term perspective with mod-

erate risks, using profit targets set for

each division, ethically, and with operat-

ing methods that show responsibility for

the environment.

Business operations are to be kept

simple, focused and specialized.

The Group has no need to boost net

sales as an end in itself. Net profit and

the cash flow from operations are more

important than net sales.

The business divisions must be ap-

propriately small or large for their field.

The critical factor for growth, if any, is

to reach or maintain the critical mass

required for successful operations.

The Group management aims to

harmonize the missions and limitations

set and/or approved by the owner, stra-

tegic efforts based on the business divi-

sions’ requirements, the learning capaci-

ty of the working community, and indi-

viduals’ commitment to change.

The traditional, close-knit integra-

tion of decisions by the owner and the

Group management is accepted and uti-

lized. The capacity for rapid decisions,

essential for successful business, is

maintained by anticipating trends and

by forecasting future scenarios: by pre-

paring in advance for limiting factors,

risk scenarios and authorizations.

The Group does not commit itself

to new fields of business without relin-

quishing one of a similar class.

The Group’s business divisions and

units are conservative in taking financial

risks, which must not, however, lead to

passiveness. Companies that do well and

generate added value for their owner are

energetic in their business operations

and in improving these. The Group ac-

cepts the occasional losses that may

arise from dynamic business operations,

if they are proportionate to the gains

made over an agreed period of time and

if they are appropriate to the unit’s risk-

taking capacity.

When a decision is made by the

Group on the distribution of profit,

among the factors considered are the li-

quidity of the Group and the division in

question as well as the need to safeguard

future operations. No profit is distribut-

ed on the basis of the unrealized capital

return (capital yield) of the Real Estate

Division as this represents the prime

risk buffer for the entire Group.

The Group is mindful of its envi-

ronmental impact in its operations. The

Group has a system for the management

of environmental matters: an environ-

mental programme, the implementation

of which is monitored by means of an

eco-accounting system and an environ-

mental management system.

The 150th anniversary celebration for the na-

tional anthem, Our Land, reached its climax at

the main national event on Flora day, 13 May

1998, at Kumtähti Field. The picture shows

Ulla Kuisma and Anu Piilola of the Student

Union celebrating Flora Day in 1997.

Ph

oto:

Jyr

ki K

omu

lain

en

T h e G r o u n dR u l e s o f t h eG r o u p ’ s O w n e r

. . . A n d h i g h e r y e t s o m e d a y s h a l l r i n g T h e p a t r i o t - s o n g w es i n g .

21

T

T h e O w n e ro f t h e G r o u p

he Student Union of the Univer-

sity of Helsinki was founded in 1868.

Today, the Union has roughly

30,000 members. The members of the Union

are studying for Bachelor’s or Master’s de-

grees at the University of Helsinki. Postgradu-

ate students are also eligible to join the Union.

The Union lobbies on behalf of the stu-

dents’ interests and provides its members

with a wide range of services. It also serves

more than 200 organizations operating with-

in its sphere of influence. The Student Union

charges a membership fee which entitles the

member to a personal Union card. The Un-

ion card entitles the bearer to reductions on

public transport, in theatres and from a

number of companies. The Student Union’s

own membership services include subsidized

meals, free legal aid, short-term emergency

loans, a subscription to the Ylioppilaslehti

student magazine, and a Student diary. The

Student Union finances its operations with

its membership fees and with the profits dis-

tributed by its business operations.

The Student Union’s first building of its

own, the Old Student House, was completed

in 1870 and the next, the New Student

House, followed in 1910. Today these premis-

es are an integral part of central Helsinki

along with the commercial buildings con-

structed in the 1950s and 1980s. The Student

Union also owns other commercial, educa-

tional and residential properties as well as

shares in cooperative housing.

Supreme authority in the Student Union

is wielded by a Representative Council of 60

delegates elected every two years. The Repre-

sentative Council elects the Board of the Stu-

dent Union, which in turn appoints the HYY

Group’s Supervisory Board and Board of Di-

rectors.

Student Union membership (30,000)

Representative Council (60)

Board of the Student Union (7 - 13)

Annual general meeting

HYY Group Supervisory Board (12 -18)

HYY Group Board of Directors (6 - 9)

22

H Y Y G r o u p

A n n u a l R e p o r t o f t h eB o a r d o f D i r e c t o r sf o r 1 9 9 7

22

FINANCIAL STATEMENTSACCORDING TO INTERNA-TIONAL ACCOUNTINGSTANDARDS (IAS)

BUSINESS CLIMATE AND TRENDS

The travel industry, particularly air trav-

el, continues to grow briskly in Europe,

including the countries and segments in

which KILROY travels does business, ex-

cept for Germany. KILROY travels sub-

stantially increased its market share and

its market leadership in the Nordic re-

gion. Owing to a change in the opera-

tional structure, its market share in Ger-

many declined slightly. KILROY travels’

market share grew a little in Spain and

the Netherlands.

In the Real Estate Division, demand

in the market for business premises in

central Helsinki continued to pick up in

1997. The prevailing levels of rent went

up markedly, especially for commercial

premises, and demand for business

premises in good locations clearly out-

stripped supply. The proportion of va-

cant office space is at its lowest at any

time in the 1990s. The overall increase

in rents for office space has been moder-

ate. The rental occupancy rate and pric-

ing of the HYY Group’s city centre

property has corresponded to the gener-

al trend. Most of the office premises in

the Kaivotalo building, which was built

in 1955, have been modernized in recent

years during a period of lower rents and

lower-priced construction costs in the

last economic downswing. During 1997,

major international and Finnish corpo-

rate tenants have moved into renovated

premises in the city centre property.

Long-term contract extensions were also

made with key tenants during the year.

In business related primarily to uni-

versity and educational communities

(UniCafe, Gaudeamus, University Book-

store, University Press) the units of the

HYY Group maintained or slightly in-

creased their market share.

NET SALES

The Group’s net sales in 1997 were FIM

910.6 million (FIM 798.4 million in

1996). Net sales were up by 14%.

Of the Group’s net sales, 29% was

generated in Finland and 71% abroad.

DIVISIONS

Real Estate Division

The Real Estate Division’s net sales in

1997 were FIM 55.6 million (1996: FIM

55.3 million), an increase of roughly 1%

on the previous year’s net sales. The net

profit, after FIM 5.8 million in planned

depreciation, FIM 2.0 million in divi-

dends received from subsidiaries, FIM

7.1 million in net interest, and FIM 3.9

million in capital gains booked as ex-

traordinary income in the real estate in-

come statement, amounted to FIM

23.5␣ million. The profit from actual

rental of business premises was FIM

18.8␣ million (1996: FIM 14.2␣ million).

An income amendment applied to pre-

vious years arising from a change in ac-

counting procedures has also been post-

ed to extraordinary items. Direct taxes

and real estate taxes totalled FIM

4.3␣ million. The net profit exceeded the

target.

Travel subgroup

In cash terms, the net sales totalled FIM

759.0 million (1996: FIM 655.2␣ million),

representing an increase of approxi-

mately 16% on the previous year’s fig-

ure.

Calculated according to the busi-

ness principle of prudence, the Travel

Group’s profit was FIM 9.4 million after

entries of income and expense, planned

depreciation amounting to FIM 9.2␣ mil-

lion and net financing income of FIM

1.1 million and before taxes (1996: FIM

7.5 million). Depreciation includes FIM

2.5␣ million in depreciation of goodwill

according to Finnish accounting con-

ventions. FIM 5.3␣ million was booked in

taxes. The profit after taxes and before

minority interest was FIM 4.1␣ million

(1996: FIM 3.6 million). Minority inter-

est amounted to FIM +0.6 million

(1996: FIM +0.6 million).

In all, the 1997 profit was once

again better than the target. In spite of

investments in new business premises in

Norway and Sweden, which exerted a

drag on profits in the short term, the

trend in profits was good, especially in

Norway but also in other Nordic coun-

tries. In Germany, focusing on the clien-

tele and working methods in line with

the KILROY concept was continued with

greater intensity, which further reduced

net sales in the short term but improved

the prospects for profitability. Largely

for reasons of labour law, an operational

restructuring has taken more time than

expected and the unit still posted a loss,

although a smaller one. In the Nether-

lands, efforts were consciously devoted

to building up the market position and

to the operational framework, and

healthy profits are only expected of this

2323

in the years ahead. The Spanish compa-

ny posted a profit.

According to the subgroup’s Danish

financial statements, KILROY travels’

net sales in 1997 were approximately

DKK 955.0 million. The profit before

taxes and minority interest was DKK

15.4␣ million.

In the subgroup’s own financial

statements according to Finnish ac-

counting and IAS conventions, share-

holders’ equity was FIM 50.5␣ million at

year-end (1996: FIM 47.3 million), of

which FIM 31.9␣ million was nonrestrict-

ed equity. On the basis of the net profit

for 1996, a 10% dividend was paid in

1997.

Catering Division

The Catering Division’s net sales in 1997

were FIM 66.2␣ million (1996: FIM 62.6

million), an increase of 6% on the previ-

ous year’s figure. The profit after FIM

1.0␣ million in planned depreciation and

FIM 0.6␣ million in net financing income

was FIM 2.1␣ million. As a whole, the di-

vision achieved its profit targets set on

principle.

The UniCafe restaurants did well

against heavy competition in Helsinki.

Restaurant Vanha fell short of its profit

targets. The hostel’s financial result was

exceptionally good, as it had been the

previous year.

Book Division

The Book Division’s net sales in 1997

were FIM 28.7 million (1996: FIM

28.5␣ million), up by roughly 1%. The

loss was FIM 0.8 million after FIM 0.9

million in planned depreciation and

FIM 0.5␣ million in net interest. Depreci-

ation includes FIM 0.3␣ million in depre-

ciation on goodwill. The costs of bring-

ing a challenging investment in infor-

mation systems on line during the year

exerted a nonrecurring drag on Univer-

sity Bookstore Finland Ltd’s profits.

Parent company

HYY Group Ltd’s net sales in 1997 were

FIM 9.4 million (1996: FIM 9.5 million).

The profit was FIM 1.0␣ million after

FIM 0.9␣ million in planned deprecia-

tion, FIM 1.1 million in net financing

income, and Group contributions re-

ceived plus capital gains on the sale of

shares in affiliated companies in a ter-

minated division, booked under extraor-

dinary income, together totalling FIM

3.0 million, as well as FIM 0.3 million in

direct taxes (1996: FIM 2.9 million).

HYY Group Ltd’s consolidated

shareholders’ equity was FIM 26.4 mil-

lion at year-end (1996: FIM 26.7 mil-

lion), of which FIM 11.4 million was

nonrestricted equity. In 1997, a 13%

dividend was paid on the 1996 profit.

CONSOLIDATED RESULT

The Group improved its profits. The

profit before extraordinary items,

change in reserves and taxes was FIM

28.1 million, up by FIM 5.8 million on

the previous year’s figure. The profit ex-

ceeded the budget target for the finan-

cial year confirmed by the Student Un-

ion of the University of Helsinki as

owner.

The operating profit before and af-

ter depreciation improved. Operating

profit before depreciation was FIM 48.5

million (FIM 45.3 million in 1996) and

FIM 29.9 million after depreciation

(FIM 25.6 million in 1996). The operat-

ing profit before and after depreciation

includes FIM 3.9 million in capital gains

from the sale of the Real Estate Divi-

sion’s fixed assets, booked as continuing

other income from business operations.

The capital gains from the sale of the

same individual building, spread over

two years, was FIM 3.1␣ million in 1996.

The return on investment at book values

(net of capital gains on sales of fixed as-

sets) was 18.2% (17.1% in 1996).

The audited figure for the unreal-

ized capital return or change in value of

the Student Union’s real estate for the fi-

nancial year, calculated by the Finnish

Institute for Real Estate Economics, was

approximately FIM 59␣ million. The cap-

ital value of the Student Union’s real es-

tate (the present-day value of net rental

income receivable in the future) was

roughly FIM 701␣ million at the start of

the year and some FIM 760␣ million at

year-end. The calculation of capital val-

ues is based on a 7.95% total return re-

quirements and a 95% occupancy rate.

The income return of the real estate (net

rental yield as a percentage of the capital

value at the beginning of the financial

year) was 4.4%. The capital return ratio

(change in the capital value as a percent-

age since the beginning of the year) was

8.4%. The total return of the real estate

in 1997 was therefore 12.8%.

INVESTMENTS

Gross investments by division:

Real Estate Division FIM 9.1 million

Travel Group FIM 5.2 million

Others FIM 1.4 million

FIM 15.7 million

2424

Investments in real estate were allocated

to the modernization of existing capaci-

ty. Investment in other respects was

mainly allocated to information technol-

ogy systems and purchases of related

software and hardware.

The group’s net investments totalled

FIM 9.7␣ million after sales of fixed assets

amounting to FIM 6.0 million.

FINANCING

Liquid assets at year-end totalled FIM

149.0 million (compared with FIM 125.1

million in 1996). The Group’s liquidity

was good. The net amount of the princi-

pal of interest-bearing loans at year-end

was FIM 126.9 million (FIM 143.2 mil-

lion in 1996). Net financing expenses

were FIM 1.8 million (FIM 3.4 million

in 1996).

The equity ratio at book values was

18.2% (11.6% in 1996). The audited po-

tential revaluation of the Group’s land

areas as given in the notes to the finan-

cial statements, figuring in solvency, is

51.7% (47.7% in 1996).

The cash flow generated by the

Group’s actual business operations was

FIM 50.2 million in surplus. The cash

flow financing thus fully covered the

Group’s cash-basis net investments at

FIM 9.7␣ million.

The average weighted effective inter-

est rate on the principal of the Group’s

loans was 5.7% in 1997 (5.6% in 1996).

PERSONNEL

The HYY Group had an average of 579

employees, which was an increase of 28

over the previous year. The increase in

staff was due to growth in the business

of the UniCafe company in Finland and

to increases in the number of branches

of the KILROY companies in the Nordic

region. Of the personnel, 294␣ were in

Finland and 285 in other countries.

ECOLOGICAL STANDARDS

FOR OPERATIONS

The main points of the HYY Group’s ec-

ological activities in 1997 consisted of

carrying out the environmental pro-

gramme approved in 1996. The goal is

to mitigate the indirect environmental

impact typical of the companies in the

Catering Division. Auditing as pre-

scribed by the management system for

the environmental programme was car-

ried out in 1997 for the first time. The

summary of the audit noted that consid-

erable progress had been made on the

practical level in all divisions. The audit

recommended further clarification of

questions of responsibility for environ-

mental affairs, obtaining environmental

reports from business partners, and in-

creased environmental training for the

staff.

OUTLOOK FOR THE 1998

FINANCIAL YEAR

Particularly as a result of expansions to

the Nordic network of business location

and the upgrade of sales information

systems, KILROY travels’ net sales are

forecast to continue to grow faster than

the overall growth of the market and

better profits are also forecast.

Because of the high occupancy rate

of the real estate, rental net sales will

not grow substantially with the present

real estate capacity. Because of new and

extended rent agreements, the net profit

would have improved in 1998 to the

peak level of the 1980s in real terms but

for a temporary drag on profits from

missing rental income during current

and forthcoming extensive renovations

and alterations to Hansa House and the

Library Building.

The combined net profit of the Ca-

tering and Book Divisions is forecast to

be slightly in the black once again. Re-

structuring is being carried out in the

Book Division, and this may reduce net

sales but is aimed at boosting profitabil-

ity.

The budgeted net sales for the en-

tire Group in 1998 is roughly FIM

1.1␣ billion. The net profit is forecast to

be an improvement on the 1997 figure.

Trend in personnel by division:

Division 1997 1996

Real Estate Division 14 15

Travel Group 338 306

Catering Division 184 179

Book Division 26 31

Parent company HYY Group Ltd 17 20

Total for Group 579 551

2525

1 9 9 7I A S F i n a n c i a l S t a t e m e n t s

H Y Y G r o u p

I N C O M E S T A T E M E N T

1997 1996

Net sales 915,390,711 802,815,296Expenses (885,039,512) (776,723,551)Operating profit 30,351,199 26,091,745

Share in affiliated companies’ profits 0 82,977

Financing income and expenses (1,252,346) (2,344,011)

Profit before taxes and minority interest 29,098,853 23,830,711

Taxes (10,011,601) (8,670,235)

Minority interest 144,492 169,444

Profit before extraordinary items 19,231,744 15,329,920

Extraordinary items 208,523 0

Net profit for the year 19,440,266 15,329,920

Negative figures are in brackets.

B A L A N C E S H E E T

1997 1996Fixed assets and other long-term expenditure

Material fixed assets 147,787,631 147,475,403

Stocks and shares, goodwill, immaterial rightsand other long-term expenditure 21,707,077 25,486,456

Long-term loans receivable 4,407,426 4,484,721

173,902,134 177,446,580

Inventory and financial assets

Inventory 8,071,429 8,050,499

Receivables and advance payments 31,787,850 26,014,966

Cash and bank 124,370,330 111,003,513

Other liquid assets 23,808,659 13,322,154

188,038,268 158,391,132

Current liabilities

Advance payments and deferred liabilities 92,170,936 99,662,859

Instalments on long-term loans 13,174,488 14,503,550

Other short-term debts 91,550,596 66,749,059

196,896,020 180,915,468

Net working capital (8,857,752) (22,524,336)

165,044,382 154,922,244

Shareholders’ equity 40,956,709 21,588,823

Minority interest 6,189,233 6,081,713

Long-term liabilities 117,898,439 127,251,708

165,044,382 154,922,244Negative figures are in brackets

26

C A S H F L O W S T A T E M E N T

(FIM 1,000) 1997 1 996

O r d i n a r y o p e r a t i o n s

Cash inflow:From sales 907,713 812,378

Cash paymentsPurchases (675,198) (601,264)Wages and salaries (105,479) (95,017)Other expenses (61,323) (65,153)Interest (2,312) (4,379)Taxes (13,165) (5,443)

(857,476) (771,258)

Net cash flow from ordinary operations 50,237 41,120

I n v e s t m e n t

Investment loans, decrease 39 77Income from sale of affiliated companies 1,573 0Investment in subsidiaries (37) (4,318)Income from sale of fixed assets 4,000 3,980Investment in fixed assets (15,300) (16,082)

Net cash flow from investment (9,725) (16,343)

F i n a n c i n g

Long-term liabilities, change (11,096) 2,255Quasi-equity financing, increase 395 1,776Loans receivable and deposits, change (8,103) (375)Income from sale of share investments 299 49Securities included in financial assets, change (10,243) (7,480)Dividends received 20 4Dividends from affiliated companies 32 47Dividends paid to minority shareholders (228) (290)Advance on distribution of profit 0 (12,843)

Net cash flow from financing (28,924) (16,858)

Net change in cash assets 11,589 7,919

Cash assets on 1 January 111,003 103,480

Effect of exchange rate fluctuations 1,778 (395)

C a s h a s s e t s o n 3 1 D e c e m b e r 124,370 111,003

Negative figures are in brackets

26

2727

C O M P A R I S O N O F F I N N I S H A N D

I A S F I N A N C I A L S T A T E M E N T S1997 1996

Net profit for year in Finnishfinancial statements 17,420,583 14,674,813

Untaxed reserves 984,207 (926,156)Previously booked pension expenses 493,951 479,139Unrealized gains/losses on exchange rates,proportion for accounting period 541,525 1,102,124

Net profit for year according to IAS financial statements 19,440,266 15,329,920

Shareholders’ equity in Finnishfinancial statements 45,880,871 28,532,669

Unrealized losses/gains on exchange rates (1,390,852) (1,932,377)Pension liability (5,533,585) (6,027,536)Untaxed reserves 2,000,275 1,016,067

Shareholders’ equity in IAS financial statements 40,956,709 21,588,823

Negative figures are in brackets.

Scope

The consolidated financial statements of

the Group include, in addition to the

real estate owned by the Student Union

of Helsinki University, the companies in

which the parent organization directly

or indirectly has over 50% of the voting

rights.

All companies in which the direct

or indirect shareholding of the parent

organization is 20 to 50% are considered

affiliated companies. However, the affili-

ated real estate companies have been ex-

cluded from the consolidated financial

statements because they have no effect

on the Group’s net profit and sharehold-

ers’ equity. At the end of the accounting

period, the Group had no affiliated

companies with the exception of two

unconsolidated real estate affiliates.

Accounting conventions

The consolidated financial statements

are given in Finnish marks, and they are

based on the original acquisition costs.

The book value based on the acquisition

cost has been reduced to the current

market value, when necessary.

The financial statements have been

prepared using acquisition accounting.

Part of the difference between the sub-

sidiaries’ acquisition value and the bal-

ance sheet value at the time of the ac-

quisition is presented in the fixed assets

items, and the rest is shown as goodwill

on which straight-line depreciation has

been applied over five years. The pro-

portion of the affiliated companies in

the result is based on the equity method.

Intra-Group business transactions

have been eliminated, and intercompany

receivables and payables have been de-

ducted in connection with relevant

balance-sheet items.

Items denominated in

foreign currency

Foreign financial statements, receiva-

bles and payables denominated in for-

eign currency have been translated

into Finnish marks according to the

closing date rate.

The exchange rate gain generated

by the translation of the share capital

and nonrestricted equity has been net-

ted out against the unrealized ex-

change rate losses of a corresponding

loans. The unrealized exchange rate

differences related to financing have

been entered under the financing items

of the income statement.

A C C O U N T I N G C O N V E N T I O N S

2828

Net sales

The net sales comprise the sales revenue

from products and services plus the

earnings from rents from real estate and

usage charges, minus indirect taxes on

sales and other adjustment items. The

net sales include other income from

business operations derived from the

disposal of fixed assets.

Research and development

expenses

Research and development expenses are

invariably credited or charged to income

in the year in which they arise.

Cover for pensions and

pension liabilities

The pensions and additional benefits of

all the Group’s employees have been at-

tended to through outside insurance

companies. The parent organization’s

pension liability for employees already

retired has been booked under long-

term liabilities. The reduction in the

pension liability has been entered in the

income statement by crediting person-

nel expenses.

Valuation of inventories

A weighted average price has been used

in the valuation of inventories. In the

case of own production the price in-

cludes the direct labour and raw materi-

al cost arising from the production. The

probable disposal price is the upper lim-

it for the valuation of inventory goods.

Valuation and matching

of fixed assets

The values of fixed assets are based on

the original acquisition prices. A previ-

ously drawn up depreciation plan has

been used to calculate the depreciation

on fixed assets subject to wear and tear.

The depreciation periods based on the

estimated useful lives are as follows:

• Buildings and structures 30 - 40 years

• Machinery and equipment

of buildings 10 - 15 years

• Equipment and furniture 3 - 5 years

• Goodwill 5 years

• Other intangible fixed assets 3 - 10 years

The value of land is nondepreciable.

Untaxed reserves

Finnish tax legislation permits a reduc-

tion in taxable income by allocating var-

ious reserves in the financial statements.

The net profit in accordance with IAS

has been calculated before the change in

the specified reserves. These reserves are

shown in the balance sheet as part of the

shareholders’ equity.

Hidden tax liability

A tax reserve has to be made according

to the tax rate prevailing at the end of

the accounting period in order to take

into account the hidden tax liability.

The tax liability contained in the re-

serves made so far is not materially sig-

nificant, and running down the reserves

will not affect tax liability.

Extraordinary items

Extraordinary items consist of items

which are exceptional to ordinary busi-

ness operations, such as capital gains on

the sale of affiliated companies in a ter-

minated division and expenses allocat-

ed to previous years plus profit adjust-

ments arising from permanent changes

in accounting conventions.

2929

N O T E S T O T H E I N C O M E S T A T E M E N T

A N D B A L A N C E S H E E T ( I A S )

FIM 1,000 1997 1996

Net sales by divisionReal Estate Division 59,207 58,305Travel Group 759,365 655,632Catering Division 66,322 62,351Book Division 30,376 25,708Others 1,213 819

915,391 802,815Expenses

Expenses comprise the following items:Materials and supplies 683,992 582,352Personnel expenses 103,569 93,492Depreciation 18,684 19,680Other expenses 78,809 82,764Change in inventory (14) (1,565)

885,040 776,723Financing income and expenses

Interest income 5,885 6,273Interest expenses (6,485) (8,368)Other financing income/expenses (651) (249)

(1,252) (2,344)Extraordinary items

Extraordinary income 1,139 0Extraordinary expenses (931) 0

209 0

TaxesThe taxes in the income statement include corporate and other such income taxes as well as municipal tax onreal property, which substitutes for income tax. The marginal tax liability included in about half of the re-serves, being approximately FIM 0.2 million, will not become payable in the near future. Other reserves canbe disbursed without tax implications.

Fixed assets and depreciationOriginal acquisition price

Land areas 8,733 8,795Buildings and structures 201,075 189,718Machinery and equipment of buildings 10,067 20,451Machinery and equipment 55,187 62,909Stocks and shares 6,787 7,228Other tangible fixed assets 709 144Other intangible fixed assets 18,598 15,143Goodwill 17,797 17,785

318,953 322,173Cumulative depreciation

Buildings and structures 89,829 80,435Machinery and equipment of buildings 3,918 15,471Machinery and equipment 34,236 38,634Other intangible fixed assets 10,007 6,775Goodwill 11,468 7,895

149,458 149,210

3030

Repayment schedule for long-term liabilitiesFIM 1,000 1998 1999 2000- 2002 2003- >Loans from financial institutions 6,554 3,974 15,663 17,813Currency loans 4,542 17,015 0 0Pension loans 2,078 2,003 5,606 15,715Other loans 1,127 3,610 22,583 3,621

14,301 26,602 43,807 37,149

The interest on loans denominated in Finnish marks is either based on the Bank of Finland’s base rate or on a marketrate of interest. The interest on currency loans is either fixed or a floating rate. The rate for pension loans is set in a de-cree issued by the Finnish government. At the end of 1997, the rate was 5.5%. In 1997, the average effective interest ratein Finland was 5.7%. Mortgages and guarantees securing loans amounted to FIM 162.2 million.

Contingent liabilitiesThere were no guarantees related to operations. Guarantees given on behalf of other parties amounted to FIM 0.1␣ million.

Shareholders’ equity 1997 1996At start of period 21,589 18,613Dividends to minority shareholders (228) (290)Advance distribution of profit - (12,843)Adjustments of goodwill - 542Exchange rate fluctuation 156 237Net profit for the year 19,440 15,330At year-end 40,957 21,589

Book valueLand areas 8,733 8,795Buildings and structures 111,246 109,283Machinery and equipment of buildings 6,149 4,980Machinery and equipment 20,951 24,275Stocks and shares 6,787 7,228Other tangible fixed assets 709 144Other intangible fixed assets 8,591 8,368Goodwill 6,329 9,890

169,495 172,963Reserves included in shareholders’ equity

Accumulated difference between overall andplanned depreciation 2,000 1,016

Long-term liabilitiesLoans from financial institutions 65,561 67,226Foreign-currency denominated loanstaken in Finland 21,557 26,511Pension loans 25,402 26,079Other long-term debt 41,237 29,177

132,200 148,993Instalments on loans 14,301 (21,741)

117,898 127,252

3131

S i g n a t u r e s o f t h eB o a r d o f D i r e c t o r sa n d t h e P r e s i d e n t

Petteri Huovinen

Chairman

Kimmo Kivelä

Pentti Laaksonen

Johanna Haltia

Otto Lehtipuu

Harri Tanhuanpää

Mika Ihamuotila

Hannu Liekso

Tapio Kiiskinen

President and CEO

We have reviewed the accounts of HYY

Group. These accounts have been adapt-

ed from the Company’s consolidated

statutory accounts, which have been

prepared in accordance with Finnish

accounting practice.

In our opinion the accounting policies

used in this adaptation are in accord-

ance with International Accounting

Standards (IAS).

Helsinki, 1 April 1998

KPMG WIDERI OY AB

Reino Tikkanen

Authorized Public Accountant

R e p o r t o ft h e A u d i t o r s

S i g n a t u r e s a n dR e p o r t o f t h e A u d i t o r s

Helsinki, 31 March 1998

32

The HYY Group’s Board of Directors

Ph

oto:

Ju

ssi A

alto

A d m i n i s t r a t i o na n d B o a r d s o f D i r e c t o r s ,3 1 M a r c h 1 9 9 8

Representative Council of the

Student Union

Chairman of the Student Union

Jaakko Hietala

Deputy Chairpersons

Sari Sarkomaa

Veijo Åberg

Members

60 members of the Student Union,

chosen by general election for a

2-year term

Board of the Student Union

Chairperson

Heli Lantta

Deputy Chairperson

Anu Piilola

Members

Ossi Heinänen

Sanna Hellström

Petteri Huovinen

Miska Kuhalampi

Panu Laturi

Antti Lauri

Riikka Nisula

Jan D. Oker-Blom

Minna Romppanen

Niko Simola

Supervisory Board of

HYY Group Ltd

Chairman

Tatu Rauhamäki

Deputy Chairman

Rabbe Sittnikow

Members

Kai Haarma

Sami Heistaro

Esa Iivonen

Marko Janhunen

Niko Lehtonen

Pia Majonen

Nora Malin

Kyösti Niemelä

Anna Parpala

Anu Piilola

Teppo Raininko

Minna Romppanen

Risto Savolainen

Vesa Syrjä

Ellen Vogt

Board of Directors of the

HYY Group

Chairman

Petteri Huovinen

Deputy Chairman

Otto Lehtipuu

Members

Johanna Haltia

Mika Ihamuotila

Kimmo Kivelä

Pentti Laaksonen

Hannu Liekso

Harri Tanhuanpää

Personnel representative

Kaisa Siitonen

Board of Directors of KILROY

travels International A/S

Chairman

Tapio Kiiskinen

Deputy Chairperson

Linnea Meder

Members

Gerner Andersen

Kurt Skovlund

Kimmo Kivelä

Personnel representative

Merete Thaysen

33

KPMG Wideri Oy Ab

Real Estate Division

Book Division

Catering Division

HYY Group Ltd

A u d i t o r s

KPMG C. Jespersen,

KPMG Wideri Oy Ab

Travel subgroup KILROY travels

International A/S

HYY Group

Tapio Kiiskinen

President and Chief Executive Officer

Chairman of the Boards of Directors,

Travel Group and Book Division

Finance Director of the Student Union

Linnea Meder

First Vice-president of the

HYY Group

HYY Group Ltd

Corporate Finance and Internal

Auditing

Real Estate Division

Yrjö Herva

Director

Kaivopiha Ltd

Student Union’s real estate

Jukka Leinonen

Assistant Director

Kaivopiha Ltd

Technical and building superintend-

ent operations

H Y Y G r o u pE x e c u t i v e M a n a g e m e n t ,3 1 M a r c h 1 9 9 8

Travel Group

Børge Faaborg

Managing Director and Chief Execu-

tive Officer of KILROY travels Inter-

national A/S

Managing Director of

HYY Ejendomme A/S

Carsten Clemmensen

Director, Corporate Financial Services

KILROY travels International A/S

Dagmar Thomsén

Director, Corporate Commercial

Services

KILROY travels International A/S

Arnar Thorisson

Director, Corporate IT & Business

Development

KILROY travels International A/S

Henrik Bjørn-Hansen

Country Manager

KILROY travels Denmark A/S

Leena Dahl-Mäkinen

Country Manager

OY KILROY travels Finland AB

Claus H. Hejlesen

Country Manager

KILROY travels Germany GmbH

Åsne Trommald

Country Manager

KILROY travels Norway A/S

Luis Almonacid

Country Manager

KILROY travels Spain S.A.

Monica Murphy

Country Manager

KILROY travels Sweden AB

Catering Division

Marjo Berglund

Assistant Director

Oy UniCafe Ab

Oy Gaudeamus Ab

Liisa Lehtinen

Assistant Director

Oy UniCafe Ab

Book Division

Aila Santanen

Managing Director of the Book

Division

University Press Finland Ltd

University Bookstore Finland Ltd

34

B u s i n e s sL o c a t i o n s

Real Estate Division

Kaivopiha Oy

City Real Estate KaivopihaPO Box 1099, Mannerheimintie 5 CFIN-00101 HELSINKITel. +358-9-1311 4250Fax +358-9-1311 4306http://www.kaivopiha.fi

Kaivopiha Service OfficeKaivotalo, Kaivokatu 10 CFIN-00100 HELSINKITel. +358-9-1311 4250Fax +358-9-601 020

Domus Academica Dormitory OfficePO Box 1099, Mannerheimintie 5 CFIN-00101 HELSINKITel. +358-9-1311 4258Fax +358-9-1311 4306http://www.hyy.fi/domus

HYY Ejendomme A/SSkindergade 28DK-1159 COPENHAGEN K

Travel Group

KILROY travels International A/S

Head OfficeKnabrostraede 8DK-1210, COPENHAGEN KTel. +45-33-480 700Fax +45-33-480 777http://www.kilroytravels.com

KILROY travels Denmark A/S

Skindergade 28DK-1159 COPENHAGEN KTel. +45-33-110 044Fax +45-33-323 269

Lyngby Torv 6DK-2800 LYNGBYTel. +45-45-887 888Fax +45-45-887 398

Kongensgade 8DK-6700 ESBJERGTel. +45-76-115 900Fax +45-75-121 740

Pantheonsgade 7DK-5000 ODENSE CTel. +45-66-177 780Fax +45-66-179 872

Fredensgade 40DK-8100 AARHUS CTel. +45-86-201 144Fax +45-86-202 205

Østeraagade 23DK-9000 AALBORGTel. +45-99-351 100Fax +45-98-111 497

OY KILROY travels Finland AB

Kaivokatu 10 DFIN-00100 HELSINKITel. +358-9-680 7811Fax +358-9-651 528

Tuomiokirkonkatu 36FIN-33100 TAMPERETel. +358-3-223 0995Fax +358-3-222 1338

Eerikinkatu 2FIN-20100 TURKUTel. +358-2-273 7500Fax +358-2-273 7540

Pakkahuoneenkatu 8FIN-90100 OULUTel. +358-8-372 720Fax +358-8-379 615

KILROY travels Germany GmbH

Hardenbergstrasse 9(Charlottenburg)D-106 23 BERLINTel. +49-30-310 0040Fax +49-30-312 6975

Georgenstrasse 3 (Mitte)D-10117 BERLINTel. +49-30-2016 5900Fax +49-30-204 3724

Takustrasse 47 (Dahlem)D-14195 BERLINTel. +49-30-831 1025Fax +49-30-832 5376

Zellescher Weg 21D-01217 DRESDENTel. +49-351-472 0864Fax +49-351-472 0866

Augustusplatz 9D-04109 LEIPZIGTel. +49-341-211 4220Fax +49-341-960 5152

KILROY travels Netherlands B.V.

Singel 413-415NL-1012 WP AMSTERDAMTel. +31-20-524 5100Fax +31-20-524 5151

KILROY travels Norway A/S

Nedre Slottsgate 23N-0157 OSLOTel. +47-23-102 310Fax +47-22-332 102

UniversitetssentretBox 54, BlindernN-0313 OSLOTel. +47-23-102 370Fax +47-22-853 239

StudiesentretParkveien 1N-5007 BERGENTel. +47-55-326 400Fax +47-55-328 866

Vaskerelven 16N-5014 BERGENTel. +47-55-307900Fax +47-55-307910

Breigata 11N-4006 STAVANGERTel. +47-51-85 8600Fax +47-51-89 5225

Jomfrugata 1N-7011 TRONDHEIMTel. +47-73-566 333Fax +47-73-566 340

KILROY travels Spain SA

Hilarion Eslava 18E-28015 MADRIDTel. +34-1-544 7021Fax +34-1-544 1345

KILROY travels Sweden AB

Box 7144Kungsgatan 4S-103 87 STOCKHOLMTel. +46-8-234 515Fax +46-8-402 9308

Universitetsvägen 9(Allhuset, Frescati), Box 50004S-104 05 STOCKHOLMTel. +46-8-160 515Fax +46-8-153 321

Berzeliigatan 5S-412 53 GOTHENBURGTel. +46-31-200 860Fax +46-31-164 739

Klostergatan 14S-222 22 LUNDTel. +46-46-151 210Fax +46-46-188 330

Engelbrektsgatan 18S-21133 MALMÖTel. +46-40-664 2650Fax +46-40-664 2659

Kungsgatan 71S-903 26 UMEÅTel. +46-90-142 430Fax +46-90-135 330

Bredgränd 3S-75320 UPPSALATel. +46-18-130 090Fax +46-18-130 095

35

Catering Division

Oy UniCafe Ab

OfficePO Box 1099, Mannerheimintie 5 CFIN-00101 HELSINKITel. +358-9-1311 4271Fax +358-9-1311 4346http://www.unicafe.fi

Restaurants

DomusHietaniemenkatu 14FIN-00100 HELSINKITel. +358-9-454 3538

EläinmuseoPohjoinen Rautatiekatu 13FIN-00100 HELSINKITel. +358-9-191 7407

FysiikkaSiltavuorenpenger 20FIN-00170 HELSINKITel. +358-9-191 8322

KasvitiedeKaisaniemenranta 2FIN-00170 HELSINKITel. +358-9-191 8668

KumpulaPO Box 55 (A.I. Virtasen aukio 1)FIN-00560 HELSINKITel. +358-9-1914 0109

KäsityöHelsinginkatu 34FIN-00530 HELSINKITel. +358-9-191 7051

LadonlukkoTalonpojantie 2 A building.Viikki departmentFIN-00710 HELSINKITel. +358-9-708 5042

MeilahtiHaartmaninkatu 3FIN-00290 HELSINKITel. +358-9-241 8775

MetsätaloFabianinkatu 39FIN-00170 HELSINKITel. +358-9-622 4562+358-9-191 7603

NilsiäNilsiänkatu 3FIN-00510 HELSINKITel. +358-9-1914 0960

Opettajain kahvilaRatakatu 6FIN-00120 HELSINKITel. +358-9-191 8108

PorthaniaYliopistonkatu 3FIN-00100 HELSINKITel. +358-9-622 4202+358-9-1912 2558

PäärakennusFabianinkatu 33FIN-00170 HELSINKITel. +358-9-622 4563+358-9-1912 2407

RuskeasuoKytösuontie 9FIN-00300 HELSINKITel. +358-9-1912 7429

TiedepuistoViikinkaari 9FIN-00710 HELSINKITel. +358-9-7085 9526

VallilaTeollisuuskatu 23-25FIN-00510 HELSINKITel. +358-9-7084 4291

ValtiotiedeUnioninkatu 37FIN-00170 HELSINKITel. +358-9-191 8836

VuorikatuVuorikatu 20FIN-00100 HELSINKITel. +358-9-622 4369

Yliopiston kirjastoUnioninkatu 36FIN-00170 HELSINKITel. +358-9-1912 2748

Oy Gaudeamus Ab

Restaurant VanhaMannerheimintie 3FIN-00100 HELSINKITel. +358-9-1311 4368 / Brasserie+358-9-1311 4367 / OfficeFax +358-9-1311 4236http://www.vanha.fi

Hostel AcademicaHietaniemenkatu 14FIN-00100 HELSINKITel. +358-9-1311 4334Fax +358-9-441 201http://www.hyy.fi/hostel.htm

Book Division

Oy Yliopistokustannus UniversityPress Finland Ltd

Publisher Gaudeamus KirjaPO Box 1099, Mannerheimintie 5 C,7th floorFIN-00101 HELSINKITel. +358-9-1311 4280Fax +358-9-1311 4317

Publisher OtatietoPO Box 1099, Mannerheimintie 5 C,7th floorFIN-00101 HELSINKITel. +358-9-1311 4280Fax +358-9-1311 4317

Teaching handoutsSähkömiehentie 3FIN-02150 ESPOOTel. +358-9-468 3118Fax +358-9-455 3020

Oy Yliopistokirjakauppa UniversityBookstore Finland Ltd

E-mail: yliopistokirja@hyy.fihttp://www.yliopistokirjakauppa.fi

University Bookstore Centre / retailPO Box 833, Vuorikatu 5 AFIN-00101 HELSINKITel. +358-9-6689 2620Fax +358-9-6689 2665

University Bookstore / ordersPO Box 833, Vuorikatu 5 BFIN-00101 HELSINKITel. +358-9-6689 2630Fax +358-9-6689 2660

University Bookstore PorthaniaYliopistonkatu 3FIN-00100 HELSINKITel. +358-9-622 3363Fax +358-9-629 610

University Bookstore ViikkiUniversity Departments in ViikkiFIN-00710 HELSINKITel. +358-9-376 732Fax +358-9-347 4660

University BookstoreUniversity of TechnologyOtakaari 1 FFIN-02150 ESPOOTel. +358-9-468 2160Fax +358-9-455 1321

Parent Company

HYY Group Ltd

Group Management andInternal Services

PO Box 1099Mannerheimintie 5 CFIN-00101 HELSINKITel. +358-9-1311 4225 /Number enquiriesFax +358-9-1311 4306http://www.hyy.fi

36

Design: Varis & Ojala

Portraits: Iris Bask and Hannu Bask

Repro and printing: Kirjapaino Libris

The annual report is published in English, Finnish and Swedish.

To place orders, please phone +358-9-1311 4288.

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ENVIRONMENTALLA

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441 014Recyclable product with

low emissions during production